Student Loans: How They Changed One Life for Decades

Part one in a series of profiles of adults whose college debts came to dominate their life for years. Read part two here.
The statistics on rising student debt and the studies that show how this debt leads to stress and unhappiness during and after the school years is one thing. It's another thing altogether to put a face on the problem.

Here's one of the many stories I've heard in recent weeks from folks at least 10 years removed from college and still paying their student loans. There are horror stories out there. This isn't one of those. In fact, there is nothing exceptional in this or many of the stories I heard -- other than how common it is for a relatively small amount of misunderstood debt to dictate the course of a student's life for decades after graduation.

The purpose of telling a story like this is to strip away the sensationalism that surrounds, say, an unemployed lawyer with $250,000 in loans and show how even modest undergrad debt, if mishandled, can be a game changer.

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Meet Joylynn Jossel. She is 39 and lives in Columbus, Ohio, where she is a free-lance writer/editor with four young children. Joylynn once dreamed of becoming a lawyer. She saw those aspirations go up in smoke after making a few poor financial decisions many years ago.

Joylynn was a first-rate student in high school. She studied hard and got excellent grades. She received enough aid through merit and need-based scholarships that, from a funding point of view, her college days should have been a breeze. "I never really had to value the college dollar," she recalls. "I got checks every semester and was able to buy my books and pay my living expenses. I didn't even care what college cost. It was all taken care of."

Joylynn spent two years at a community college to conserve cash and then transferred to Capital University, a private hometown school where she intended to finish her undergraduate studies and enroll in law school. It was all going great. The scholarship money was rolling in and she was doing well in school. But midway through her final year she met a man and fell in love. She quit school and got married, figuring she would resume her education and restart her career ambitions a few years later.

But that's when things got rough. The marriage lasted less than a year, and when she decided to pick up the pieces of her life she found that her sudden departure from school had destroyed any chance of her qualifying for another scholarship. So she went to the financial aid office.

Joylynn needed just one semester to complete her degree in paralegal studies. The cost: $18,000. She signed on the dotted line, went back to class and in short order had earned her degree. That's when it was time to start making payments of about $400 a month, according the terms of her student loan. The day of reckoning that had seemed so far off just a year earlier had arrived in what now felt like the blink of an eye.

She took a job as a paralegal for an insurance firm but soon found that she could not pay down her student debt and make ends meet on the salary that the position paid. She began racking up credit card debt to stay current on the student loans. When she had tapped out her plastic she started taking advances on her salary. It was an ugly downhill spiral that culminated with a personal bankruptcy filing just two years removed from college -- but not before she was served papers in front of her boss authorizing creditors to garnish her wages.

"It was a black tornado," she says. "I couldn't even breathe. I was robbing Peter to pay Paul. It was just a vicious cycle."

By the time Joylynn was in bankruptcy her student loan balance was unchanged at $18,000; all she had been able to pay was the interest on her loans. Her credit card debt had swollen to $10,000. She had an auto loan and other debts too. So she was much further behind than on the day she graduated.

Joylynn briefly considered going back to law school. "But when we got to the financial part and I started hearing about loans I got sick to my stomach," she recalls. "I couldn't imagine all those years of repayment when just one semester's worth of debt had put me so far behind. For something that I loved for so many years, it just scared me away from the whole idea of law school."

Virtually all of her debts were wiped clean in bankruptcy proceedings -- but not the student debt. That is not a dischargeable item. Still, the relief gave her enough room in her budget to begin making minimum payments on her student debt. She has stayed current and is on track to make her final payment sometime before she turns 40. By then it will have been more than 15 years that she struggled with the debts she amassed while in college.

Bear in mind that Joylynn's debt of $28,000 (loans and credit cards) was a relative pittance. Plenty of college grads owe $50,000 or $100,000. Yet her small financial hole, dug while she was in school and not paying attention to the details, dictated the course of her life for nearly two decades.

"I love being a writer and an editor," she says. "But this is not what I was supposed to do. I'm supposed to be an attorney. That debt was supposed to be meaningless. I was supposed to be able to win a big case and pay it all back. It's an embarrassing thing to still have this undergrad debt hanging over my head."

Joylynn says that once her final payment is made she'll consider going to law school but that she can't talk about it before she's truly in the clear. She says she'd like to finish what she started, "even if it takes me until I'm 60." But in the same breath she adds that her first priority "is being able to take the monthly savings and put it toward my kids' college tuition plan. That's what I'm really looking forward to."

Her priority, she says, is making sure her kids can get through college without borrowing so that they can chase their career dreams in their 20s -- not defer them into their 40s or 50s as she has had to do.

Daniel J. Kadlec is an author and journalist whose work appears regularly in Time and Money magazines. He is the former editor of Time’s Generations section, which was written and edited for boomers. Kadlec came to Time from USA Today, where he was the creator and author of the daily column Street Talk, which anchored the newspaper's business coverage. He has co-written three books, including, most recently, With Purpose: Going from Success to Significance in Work and Life. He has won a New York Press Club award and a National Headliner Award for columns on the economy and investing.